OPENPUBLICA · PUBLIC MEETING RECORD
Record of Proceedings

Administration, Investment & Fiscal Management Board Meeting - February 19, 2026

Administration, Investment, & Fiscal Management Board — Thursday, February 19, 2026
BodySacramento, California
SessionAdministration, Investment, & Fiscal Management Board
DateThursday, February 19, 2026
StatusFILED
Video Record
0:00 / 24:07
Transcript — Verbatim
0:15

All right, good afternoon, everybody.

0:17

Uh, we're gonna call the order the administration investment and fiscal management board meeting for February 19th.

0:23

Uh Madam Clerk, can you please call the roll?

0:25

Yes, thank you, Chair.

0:26

Member Kolbu?

0:27

Yeah.

0:28

Member Tool.

0:29

Here.

0:29

Oh, Tool, excuse me.

0:31

Member Tamayo?

0:32

Here.

0:33

Member Zammi Sumny.

0:36

Absent.

0:36

And Chair Coletta.

0:38

I am here.

0:39

Would everyone please rise for the land acknowledgement and pledge of allegiance?

0:44

To the original people of this land, the Nissanon people, the Southern Maidu, Valley and Plains Vok, Patwin Wintoon peoples, and the people of the Wilton Rancheria, Sacramento's only federally recognized tribe.

0:57

May we acknowledge and honor the native people who came before us and still walk beside us today on these ancestral lands by choosing to gather together today in the active practice of acknowledgement and appreciation for Sacramento's indigenous people's history, contributions, and lives.

1:15

I pledge allegiance to the flag of the United States of America and to the Republic for which it stands, one nation under God, individual with liberty and justice for all.

1:28

Okay.

1:29

So we'll move on to the consent calendar.

1:34

Do we have a motion?

1:36

I'll move it.

1:38

Six seconds.

1:39

Do we have any uh public comment?

1:41

No, we do not.

1:42

Thank you.

1:43

Do we have any board member comments or questions?

1:47

Okay.

1:48

So all in favor, please say aye.

1:51

Aye.

1:51

Oppose abstentions.

1:53

Uh so it passed.

1:54

So we'll move on to the discussion calendar.

1:56

Uh, item number four, the SCARS quarterly investment report.

2:01

Good afternoon.

2:02

Um, I'm gonna actually be going first today.

2:04

I know the order got reversed, um so I'm gonna touch on a couple quick points on our internal quarterly report, and then Jeff will go over the Siegel report and some bigger um picture on uh markets.

2:16

So the first thing I wanted to point out in the quarterly report is in the fixed account, we did um make quite a few changes.

2:23

During the quarter, we raised about three and a half million dollars out of the equities that had really run up quite a bit.

2:30

So we opted to liquidate those and send those over to the fixed fund.

2:34

So you can see that contribution sitting there on that page seven that says 3.5 million.

2:39

So that's what that was.

2:40

Um so we continue to put funds to work in that account over four percent.

2:45

Um we are, however, starting to see some uh bonds get called in the four to five percent range.

2:50

There are very few bonds in the account that are callable.

2:53

I tend to look towards bullets, but there are some bonds that we have seen taken away.

2:59

Luckily, because the curve hasn't moved too much and interest rates have been fairly stable, we have been able to reinvest it.

3:05

Um the current income on the account is about 4.5 million as of today, and that's up from 2.6 million in 2122.

3:14

Uh moving on to the large cap account.

3:19

Get there.

3:21

Um so on the large cap account, the midpoint of the year uh returns were in the double digits.

3:26

It's really been uh very strong equity year up until probably the last two to three weeks, I would say.

3:32

Um and again, as those continued to go up, we did liquidate from those, so you'll see a withdrawal on that, and that's gonna be a combination of the assets we sold and a combination of the dividends being swept out for the operating account.

3:46

Likewise on the equity income account for the first half of the year, it had a very strong return approaching double digits there at nine um 9.35 for the first six months of the year.

3:58

And again, the 5.2 million in withdrawals you'll see there is the combination of the dividend sweeping out and the money going back over to the fixed fund.

4:06

Um so in January, another um move that we did that you won't see until the next quarterly report is we had several bonds in the fixed income account that were sub-2%, and so we opted to do swaps on those, and so now there are no more bonds in the portfolio that are under two percent.

4:25

Um and additionally, we raised some funds for out of the equity accounts for the operating account.

4:33

And so we now have sitting in the sitting in each equity account all the funds to take care of operating all the way through July 1st, 2026.

4:43

As a result of the run-up, we just thought it would be prudent to lock those gains in, sit in cash so that if we started to see more volatility, we would not be forced sellers going into the rest of the fiscal year.

Discussion Breakdown — Share of Meeting
Budget and Finance█████████████████████████████████████████████86%
Procedural██████11%
Personnel Matters██3%
Summary of Proceedings

Administration, Investment & Fiscal Management Board Meeting - February 19, 2026

The Administration, Investment & Fiscal Management Board of Sacramento met on Thursday, February 19, 2026, at 1:00 PM at City Hall Complex. All four present members (Chair Peter Coletto, John Colville, Dave O’Toole, Michael Tamayo; Yousaf Zamanudin absent) unanimously approved items on the consent calendar and discussion calendar, including investment reports, the SCERS annual financial report, and the selection of officers for 2026.

Consent Calendar

  • Approval of Board Meeting Minutes (File ID: 2025-01995): Unanimously passed a motion approving the minutes from November 20, 2025.
  • Continuation of Bloomberg Agreement (File ID: 2026-00486): Adopted a resolution approving the continuation of the Bloomberg agreement for Fiscal Year 2026-2027.
  • SCERS Monthly Investment Reports (File ID: 2026-00524): Unanimously passed a motion accepting the SCERS Monthly Investment Reports for October, November, and December 2025.

Discussion Items

  • SCERS Quarterly Investment Report for December 2025 (Item 4): Stacy Hussey, Chief Investment Officer, presented the internal quarterly report. Key points included: raising approximately $3.5 million from equities and moving to the fixed fund; current fixed income yield at 4.5%; large cap and equity income accounts showing double-digit returns for the first half of the fiscal year; and the full liquidation strategy monitored with a 10% overall return target and a trigger of 7,000 on the S&P 500. Additionally, in January 2026, bonds under 2% were swapped out, and funds were raised to cover operating needs through July 1, 2026, to avoid forced selling. The board unanimously voted to accept the report.
  • Segal Marco Advisors Quarterly Investment Performance Report for December 2025 (Item 5): Jeffrey Nipp, Senior Vice President of Segal Marco Advisors, presented the performance report. He noted the S&P 500 was up nearly 18% in calendar year 2025, the third consecutive year of double-digit returns, with broadening market participation and defensive sectors (e.g., healthcare up 12% in Q4) performing well. The yield curve steepened as the Fed cut rates twice in Q4 but signaled a pause. The SCERS portfolio returned 2.5% for the quarter, 7.5% for the fiscal year-to-date, and 13% for the calendar year, well ahead of the actuarial rate and custom benchmark. Nipp also mentioned that the board might consider increasing fixed income exposure (currently at 40% target), noting historical levels of 45-50% during the 2008 financial crisis. Nipp announced his planned retirement later in 2026 and introduced his successor, David Roll. The board unanimously accepted the report.
  • SCERS Annual Financial Report for Fiscal Year 2025 (Item 6): Osvaldo Lopez, Finance Manager, presented the audited financial statements. The independent audit firm Macias Gini & O'Connell (MGO) issued an unmodified opinion. Net position restricted for pensions was nearly unchanged at $253.4 million. Employer contributions remained stable at $1.4 million. Net investment income decreased from $30.5 million (FY24) to $26.3 million (FY25) due to lower net appreciation. The city's net pension asset increased from $4.1 million to $22.1 million, and the funding status rose from 101.6% to 109.6%. The plan continues to shrink, with total plan members decreasing from 739 to 710, including only one active member as of June 30, 2025. The board received and filed the report.
  • Selection of Chair and Vice Chair for Calendar Year 2026 (Item 7): Rosanna Montesinos from the City Clerk’s office administered the election. Board members nominated and unanimously elected Peter Coletto as Chair and Dave O’Toole as Vice Chair, both for calendar year 2026. (Member Zamanudin absent.)

Key Outcomes

  • All consent calendar items and discussion items were approved unanimously (4-0, with Zamanudin absent).
  • The board accepted the SCERS quarterly investment report and the Segal Marco Advisors quarterly performance report for December 2025.
  • The board received and filed the SCERS annual financial report for FY2025.
  • Peter Coletto was re-elected Chair and Dave O’Toole was elected Vice Chair for 2026; their terms begin at the next regular meeting.
  • No public comments were made, and no board member comments were offered.

The meeting adjourned at 1:24 PM.

Meeting Transcript

All right, good afternoon, everybody. Uh, we're gonna call the order the administration investment and fiscal management board meeting for February 19th. Uh Madam Clerk, can you please call the roll? Yes, thank you, Chair. Member Kolbu? Yeah. Member Tool. Here. Oh, Tool, excuse me. Member Tamayo? Here. Member Zammi Sumny. Absent. And Chair Coletta. I am here. Would everyone please rise for the land acknowledgement and pledge of allegiance? To the original people of this land, the Nissanon people, the Southern Maidu, Valley and Plains Vok, Patwin Wintoon peoples, and the people of the Wilton Rancheria, Sacramento's only federally recognized tribe. May we acknowledge and honor the native people who came before us and still walk beside us today on these ancestral lands by choosing to gather together today in the active practice of acknowledgement and appreciation for Sacramento's indigenous people's history, contributions, and lives. I pledge allegiance to the flag of the United States of America and to the Republic for which it stands, one nation under God, individual with liberty and justice for all. Okay. So we'll move on to the consent calendar. Do we have a motion? I'll move it. Six seconds. Do we have any uh public comment? No, we do not. Thank you. Do we have any board member comments or questions? Okay. So all in favor, please say aye. Aye. Oppose abstentions. Uh so it passed. So we'll move on to the discussion calendar. Uh, item number four, the SCARS quarterly investment report. Good afternoon. Um, I'm gonna actually be going first today. I know the order got reversed, um so I'm gonna touch on a couple quick points on our internal quarterly report, and then Jeff will go over the Siegel report and some bigger um picture on uh markets. So the first thing I wanted to point out in the quarterly report is in the fixed account, we did um make quite a few changes. During the quarter, we raised about three and a half million dollars out of the equities that had really run up quite a bit. So we opted to liquidate those and send those over to the fixed fund. So you can see that contribution sitting there on that page seven that says 3.5 million. So that's what that was. Um so we continue to put funds to work in that account over four percent. Um we are, however, starting to see some uh bonds get called in the four to five percent range. There are very few bonds in the account that are callable. I tend to look towards bullets, but there are some bonds that we have seen taken away. Luckily, because the curve hasn't moved too much and interest rates have been fairly stable, we have been able to reinvest it. Um the current income on the account is about 4.5 million as of today, and that's up from 2.6 million in 2122. Uh moving on to the large cap account.

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